Congress Approves Omnibus Appropriations Bill

Includes COOL Repeal and Increased TTB Funding

Happy Holidays from all of us at WineAmerica. We had a very productive and successful year and we look forward to 2016. We will be back in the new year with a full slate of work on such issues as music licensing requirements and federal excise tax reform.

Congress wrapped up their work for the year today with the passage of the Fiscal Year 2016 Omnibus Appropriations Bill, sending it to the President’s desk for final signature. The bill fully funds the federal government until September 30, 2016. The bi-partisan agreement features several provisions relevant to the American wine industry.

  • TTB Funding: The bill features $106,439,000 in appropriations funding for TTB. This is $5,000,000 more than last fiscal year, with that money dedicated to label and formula approval.
  • COOL Repeal: The bill repeals the mandatory country of origin labeling requirements for certain cuts of beef and pork. The repeal of the COOL rule will protect the American wine industry from costly tariffs placed on wine exported into Canada and Mexico.
  • Tax Filing Requirements: Alcohol producers liable for not more than $50,000 per year in federal excise taxes to file and pay such taxes on a quarterly basis, rather than by month. Additionally, those producers liable for not more than $1,000 per year may pay taxes annually, rather than quarterly. The provision also exempts such producers from IRS bonding requirements.
  • Definition of Hard Cider: The provision defines hard cider for purposes of alcohol excise taxes as a wine with an alcohol content of between 0.5 percent and 8.5 percent alcohol by volume, with a carbonation level that does not exceed 6.4 grams per liter, which is derived primarily from apples, apple juice concentrate, pears, or pear juice concentrate, in combination with water. The previous alcohol content limit for hard cider was 0.5 percent to 7 percent.
  • Market Access Funding: The bill fully funds the USDA Market Access Program (MAP) at $200 million.  MAP funds are key for states expanding their wine sales into foreign markets.

If you have any questions about these provisions or any other part of the bill, please contact Michael Kaiser, Director of Public Affairs at mkaiser@wineamerica.org.

Wine Comes From…

Crabapples, Pineapples and Other Adventures

Wine, few other libations can elicit as much praise as it does debate. More than any other drink that humanity has had the fortune of enjoying, wine is rife with rules and norms regulating how it is produced, served, and consumed. However, some of us aren’t very knowledgeable on grape varieties, their flavor profiles, or how to even drink them. Sometimes these uncertainties intimidates us and limits our enjoyment of the drink. However, many of us have the same questions:

“What’s the difference between rose and blush?”

“Am I a philistine for being unable to taste the difference between a 2012 and 2013 vintage?”

“Will my friends and family disown me for drinking a Chardonnay with my T-bone?”

Wine is an art form and a continuous learning experience—from the neophyte to sommelier. While certain practices are adhered to, nothing is set in stone and you should ultimately do whatever it is that you enjoy.

Discussing everything there is to know about wine would take a lifetime. But, we need to start somewhere. Where better to start than what it’s made from?  In the first of what we hope will be a series of educative installments regarding the wine industry, WineAmerica presents: Wine Comes From…

Wine comes from this:

Pineapple

No, this was not a mistake made by our questionably competent intern. We are showing a pineapple to illustrate a point. Most people believe wine is exclusively made from grapes. This is only the tip of the iceberg.  From fruit wine, to mead, and cider, all these varieties fall under the umbrella of “wine”.  If you don’t believe us, check out the TTB’s definition here.

Don’t be dismayed if you weren’t even aware of these non-traditional wines. Whether this shortfall of knowledge reflects an adherence to traditionalism, lack of interest, or indecipherability of federal regulation we owe it to ourselves to become more educated about everything wine has to offer.

Non-traditional wine represents the fastest growing sector of the domestic wine industry. Demand for these wines has grown by more than 89% in the last year alone. Cider has more than tripled in gross production and value.

Much like wine grape varieties speak to the pride and place of origin, non-traditional fruit wines also carry their own cultural and historic significance. America’s love affair with non-traditional wine dates back to the first English settlers. Finding nothing but inedible crabapples, colonists quickly proceeded to import English apple seeds and cultivate cider-apples. While apple trees had little trouble taking to New England soil, it was significantly more difficult to cultivate barley and grains for beer and spirits. Cider became the beverage of choice for early America, with people like John Adams drinking a tankard every morning.

Preference for this cultural staple ebbed and flowed, but Prohibition dealt the non-traditional wine industry a near irreconcilable blow.  Fruit wines were particularly hard-pressed to recover from Prohibition and the Temperance Movement. While many breweries, distilleries, and winemakers survived these dark times by producing a range of goods from sodas to refrigerated cabinets, cider orchards and fruit wine producers had less flexibility. In addition to outlawing fruit based wines, the Volstead Act limited production of sweet cider to 200 gallons a year per orchard. Prohibitionists burned countless fields of trees to the ground and surviving orchards were forced to begin cultivating sweeter (non-cider) apples. American affinity for cider and fruit wine struggled to return following the repeal of Prohibition.  While breweries, distilleries, and wineries could go back into production almost immediately, it would take decades to convert the orchards back from snacking and cooking apples to wine and cidermaking apples.

Now almost a hundred years later, the growth of cider and fruit wine—or rather, the comeback—is both heartening and astounding. Whether its resurgence has piggybacked off the farm-to-table movement or is a reflection of changing consumption trends for millennials; a sizable contingent of consumers are more interested in seeking out uniquely local flavors.

There are currently over 700 American wineries that produce fruit wine, ciders, and honey wines. The market for domestic non-traditional wine is in its infancy and promises to expand. From Hawaiian pineapple wine, Georgia peach wine, to Vermont cider, fruit wines are increasingly recognized for complex flavor profiles in the wine industry.

For our next installment, we are looking to highlight regional grape varieties in the domestic wine industry. Send us your suggestions on Twitter!

Excise taxes proposal – Small BREW act amendment – Cider classification change

  

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Last week featured three important proposals that would impact the American wine industry in a substantial way.  The Senate Finance Committee passed three tax proposals related to federal alcohol excise taxes. A cider bill would increase the alcohol and carbonation levels for hard cider. The TTB introduced a Notice of Proposed Rulemaking (NPR) changing how an American Viticultural Area (AVA) can be used on a wine label.

WineAmerica is monitoring all of these proposals. Over the next several weeks we will be meeting with members of Congress to insure that any new legislation benefits the American wine industry.

Excise Taxes

The Senate Finance Committee passed a bill making it easier for small wineries to file their federal excise taxes and a bill lowering excise taxes on small breweries.

Small BREW Act Amendment

Seeks to reduce the small brewer rate on the first 60,000 barrels.

Cider Classification

Cider bill would increase the alcohol and carbonation levels for hard cider.

TTB Proposes Major Change to AVA Labeling

New proposed TTB rule would open up the regulations for the use of American Viticultural Areas.

For more information, click here.

Questions? Contact Michael Kaiser at mkaiser@wineamerica.org or 202-223-5172.

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Ask Your Advocate – Do you know the difference between apple wine and cider?

Is there a difference between apple wine and cider?

The labeling of cider can be confusing. Since many ciders are less than 7% alcohol by volume they are subject to FDA labeling requirements and do not need a Certificate of Label Approval.

For an apple wine that is derived wholly from apples (with the exception of sugar, water and added alcohol) the terms “apple wine” or “cider” may be used as the class/type designation of the finished product. The term “apple cider” may also be used. If the finished wine is sparkling, the word sparkling must be used in the class/type statement such as “sparkling apple wine” or “sparkling cider”.

For more information on cider please go here: http://www.ttb.gov/faqs/alcohol_faqs.shtml?Cider#Cider

Does WineAmerica work with other alcohol industry groups in Washington, DC?

WineAmerica works with many other alcohol commodity groups on a wide variety of issues. We regularly work with the Wine Institute, the Brewers Association, the Distilled Spirits Council of the United States, the Beer Institute and others. We are stronger in our messaging when we work in a coalition with other commodities. We do differ in our views on some issues, but we work well with the other groups on a consistent basis.